Charity Commission guidance on fee-charging charities is unclear, says NCVO

Umbrella body's charity tribunal witness statement highlights 'mismatch' between guidance on public benefit and its application

Fee-charging schools: public benefit questionned
Fee-charging schools: public benefit questionned

The Charity Commission’s guidance on public benefit for fee-charging charities is unclear and its assessments of such charities have created confusion and uncertainty, the National Council for Voluntary Organisations will tell the charity tribunal.

The tribunal will in May consider a reference from Dominic Grieve, the Attorney-General, that asks it to clarify how the public benefit test applies to fee-charging schools. Alongside this it will hear a request from the Independent Schools Council for a judicial review of the commission’s guidance on how fee-charging schools can demonstrate that they provide public benefit.

The witness statement, submitted to the tribunal by Sir Stuart Etherington, chief executive of the NCVO, says the umbrella body does not believe the commission has "misdirected itself as to the law" but does think its guidance on public benefit and fee-charging charities is unclear.

"Rather than promoting awareness and understanding of the public benefit requirement, the guidance and assessment reports have created confusion and uncertainty," it says.

The witness statement says there is "an apparent mismatch between what is said in the guidance and the way in which the commission has applied the guidance in its public benefit assessments".

It says that in the case of Highfield Priory School in Preston, which failed the commission’s initial public benefit assessment, the commission "did not direct itself to the right question". It says the commission should have asked about other ways in which the school made its services available to those that could not afford the fees, rather than about the level of bursaries it provided.

The document refers to an unpublished statement by the ISC, which it says argues that a fee-charging charity meets the public benefit requirement if "the charity’s purpose is to offer its services to the public as a whole or to a section of the public representing an appreciably important class of the community, on payment of its fees".

The NCVO document says the ISC argues that "some 5 per cent of the school population attend charitable independent schools, and it is clear that in any normal case those who are able to pay school fees will constitute a sufficient section of the public". It says the NCVO’s position "fundamentally differs" from this because the beneficiaries "would be qualified by personal good fortune rather than educational need".

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